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A confidential audit report from Norwegian government-owned alcoholic beverage retailer Vinmonopolet has uncovered harassment, unionization prohibitions and salaries below the minimum wage at several of its wine producers in South Africa.

07. august 2017

Peter Kenworthy

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The report is based on inspections of 22 South African wine facilities in March and April. Is was prepared for Vinmonopolet by American safety consulting and certification company UL, and conducted “to investigate and identify social compliance gaps within the wine supply chain in the Western Cape Province.”

Vinmonopolet is working hard to ensure that offending producers improve conditions and live up to their ethical guidelines, the Norwegian company insists.

In June, Vinmonopolet sold over 100.000 litres of South African wine of a total of over 6 million litres of wine. Vinmonopolet (literally “the Wine Monopoly”) is the only retailer allowed to sell wine in Norway.

Harassment, lack of training and illegal wagesAccording to Vinmonopolet’s audit report, nine of the 22 inspected facilities “did not hold health and safety meetings regularly,” employees on four facilities experienced “verbal harassment and physical harassment,” three facilities “had not issued employees with employment contracts” and “paid employees below the minimum wage,” and two “prohibited employees from joining trade unions of their choice.”

Four facilities “had deductions that were more than the stipulated legal limit,” and three “did not provide occupational health and safety training including pesticide handling training to employees.”

“The Client provided the audited facilities with the opportunity to correct reported findings before the end of the project,” the report stated in its concluding remarks.

Concerns must be resolvedIn December 2016 Vinmonopolet had demanded that eight concerns related to worker’s rights, health and safety issues, wages and grievance mechanisms must be resolved. This was following the screening of “Bitter Grapes,” Danish investigative journalist Tom Heinemann's highly critical documentary on the wine industry in the Western Cape, on Norwegian national television.

According to Senior Business Executive and CSR-responsible at Vinmonopolet Kristian Hogstad, Vinmonopolet does not wish to disclose which wine facilities were inspected by UL because they wish to focus on improving conditions and act in regard to the workers on the inspected farms.

A follow-up process and new inspections will be carried out in the future to ensure that conditions have improved, including a Vinmonopolet visit in the fall to ensure that this is indeed the case, Hogstad says.

Vinmonopolet continues to sell wine from the Western Cape, however, for instance from its bestseller Robertson Winery (not one of the inspected farms, according to Hogstad), stating that they are working with importers and the South African producers and unions to improve conditions. In Heinemann’s documentary, Robertson Winery was one of the main offenders.

Contracts may be annulledVinmonopolet has previously annulled contracts with importers and stopped selling products on several occasions, when producers have not complied with Vinmonopolet’s ethical guidelines. These include the right to unionization, a decent and legal wage, and a healthy and safe working environment.

“Our goal is to contribute to improvements in the supply chain and not rid ourselves of producers that do not live up to our ethical guidelines. This is subject to breeches of our guidelines being rectified, however. If not, we will consider revoking agreements,” says Hogstad.

The criteria for avoiding having ones contract revoked is to correct guideline breaches within at reasonable period of time (depending on how quickly the breach can feasibly be corrected), allow future inspections to take place, and generally give Vinmonopolet the information they ask for, Hogstad adds.

“Annulling an agreement prematurely will not necessarily help improve the situation, as the producer loses an important source of income and might exploit their workers even more to compensate. This must be weighed against the risk we take by continuing to sell products that do not live up to our guidelines, and whether we succeed in convincing people that it is better to give producers the time to make these improvements.”

Generally, Hogstad says that in the future Vinmonopolet is planning to improve its presence in South Africa, continue and improve dialogue with the unions, and inform and train producers and importers in regard to its guidelines.

Improvements needed for yearsBut on the face of it, improvements in the standards of several South African wine farms have been necessary for some years now.

A 2011 report from Human Rights Watch called “Ripe with Abuse – Human Rights Conditions in South Africa’s Fruit and Wine Industries” exposed “obstacles to union formation,” “long,” “gruelling” and “harsh” working conditions, and workers being denied “benefits to which they are legally entitled” and exposed to toxic pesticides without “adequate safety equipment,” as well as earning “among the lowest wages in South Africa.”

Tom Heinemann’s documentary started both a media storm and an array of inspections of offending farms by both retailers such as Vinmonopolet, Swedish Systembolaget and Danish Dagrofa, as well as by local authorities in the Western Cape. He agrees that improvements need to be made.

“For decades – if not centuries –conditions in the vineyards in South Africa have been appalling. My hope is that the new focus from authorities, buyers and importers in investigating the industry more rigorously can and will make changes. If not, there is no way out but to stop buying wine from farms that do not want to learn that workers are not their property that they can treat to slave-like conditions,” says Heinemann.